Utilizing small fragments of adipose tissue removed by aspiration for in vitro study has permitted an analysis of the biochemical events underlying lipolysis and esterification. Studies performed during the past year have given further evidence for an extracellular loop for fatty acids released by lipolysis and utilized in re-esterification. This has profound meaning for the physiology of adipose tissue as it varies from person-to-person as well as from site-to-site in the same individual.